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My employer is paying me 30p per mile fuel allowance, can I claim back the 15p difference.

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My employer is paying me 30p per mile fuel allowance, can I claim back the 15p difference, through tax as a PAYE employee, if so how do I go about it?

Thank You

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  • No, you will only be able to claim fuel allowance from your employer.

    If this allowance is for business mileage then you might be eligible to claim tax relief on the difference between the amount which can be reimbursed tax free (45p/mile for the first 10,000 business miles) and the amount your employer has reimbursed.

    So in your example it would be tax relief on 15p/mile.  Which will usually be a tax saving ranging from 0p/mile to 6p/mile but most commonly 3p/mile (15p x 20%).

    If you don't currently have to complete a Self Assessment return then you would need to complete form P87 after the end of the tax year in question.

    If your claim will exceed £2,500 (in expenses not the actual tax relief) then you have to register for Self Assessment and complete a tax return, you cannot use the P87 option.
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